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- Game on for markets and even though the markets are taking baby steps up the absence of volatility is being liked by some but not by all. Be it Wall street or Dalal street, markets are inching up gradually
- Swiss National Bank is leading the pack in rate cuts as the second cut of 25 bps sets the tone. For once it has given the lease of life to dollar index as CHF lost some value pushing DXY above 105.20
- Dow jones at the time of finalising the write up was trading up 145 pts while the Nasdaq was down 60 pts. At 4.27% the 10y US treasury yield is trading 5 bps higher than the recent bottom that it had touched at 4.20%. Till the rate direction is decisive 4.20% is the floor
- Gold thankfully managed to hold on to the support level of USD 2300 and make a comeback as overnight it gained another 23 dollars to trade at USD 2370. The Beta coefficient for silver seems to be higher this time as the white gold with industrial demand is trading in wider swings. It gained 1.20 dollar overnight at USD 30.70
- In anticipation, I repeat only anticipation, of a rate cut in US it’s the crude oil that is gradually gaining. Brent has scaled up above USD 85; no matter whatever reason may attribute to the black gold it continues to trade in a range of USD 80 – 90 and I don’t think there is too much to read into the same
- In the Indian bond market, liquidity remains stretched a bit causing jitters in CBLO and short term market but not in the danger zone at INR 1.55 trln. It might have pushed up the CD / CP rates marginally but nothing is happening to Govies as the 10y continues to trade below 7.00% at 6.97%
- For a change nifty didn’t make another lifetime high y’day but still it closed with a gain of 50 points and just 40 short of all time high. The a/d ratio was positive 2:1 with budget expectations now setting in
- For the first time I came across this question in a long time y’day – कुछ माल बेचा and when I answered माल लिया to which he replied with a surprise look stating – the deep correction is in the offing
- Voices of a deep correction have started gaining momentum and to be very honest I also feel that there has been a significant run up calling for some pullback but that’s not happening. Everyone is talking about correction but continuing to add stocks as well because there continues to be a FOMO factor at play
- For once I felt I’ve been contradicting myself and typically this is what happens when you tend to flow with the market. In a way both of us were right keeping in view the respective goals we’ve in place for ourselves. I may not be looking at a short term horizon and open to the idea of averaging as well while he may not be
- Having said that all eyes are right now on budget and all expectations building up keeping in mind the budget announcements. While we’ve been talking about the tax soaps and capital gains a new guess has hit the street
- In this phase generally everything is from an unnamed official from ministry and this one is no different. New kind of tax proposals are being mulled for F&O trading, say something like higher tax bracket and losses being allowed to be off set only against other business gains
- This point is well understood that the way F&O, that was once started as a hedging tool is now spreading like a virus calls for surgical strike but spreading rumors about that can be detrimental before and if it actually comes. And one basic question – which ministry official will make a statement at this crucial juncture
- Closing remarks – off the cuff – why do we work in teams, so that one can complement the strengths and cover the weakness of other team members. Working on your weakness is one thing but accepting it and letting someone else take the lead in such a situation is another and that makes you an even better leader. Let the morale of team not suffer for your weakness
Stay safe, stay healthy, God bless you all, have a great day !!
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Vikas Miglani writes 